WSJ's Rolfe Winkler discusses how Pinterest came up with a valuation figure of nearly $4 billion, even though the company has approximately zero revenue. Photo: Getty Images.

This transcript has been automatically generated and may not be 100% accurate.

... it's an ... arrest warrant and billions of dollars won't someone think so ... Maidstone some money now ... the fact that welcome to Digits I'm Simon Constable will Winkler ... has written of this on e joins us now from sentences go thanks obeying the trough ... I design and ... none of that very well ... let's go through this ... hence West barely has any revenue and and some evenings it's worth twenty point eight in ... the Liam ... Fox ... correction they had zero revenue ... today I ... okay so yes it's ... three twenty billion dollars the race tied to earn twenty five million ... in the in in this latest equity financing round at that valuation the forty billion nearly four billion dollars ... and they've only just started to test ... advertising on their site so yet it's it's definitely a very ... tough the valuation ... into interesting to me and it does remind me of the of Netscape back and then in the nineteen ninety one and went public with no revenue misses and quite going going public ... fountains anyone justifying ... three pointed billion box ... they say that interest has a lot of potential and I was talking to one of the venture capitalists is in this rowdy actually makes it a very interesting argument here ... take a look at ... Facebook and Google this is how she does and says look you have ... he looks at ... you look at the time spent on these sites ... and ... the inclination of the users of the sites to buy things when they're they're so take Facebook for instance people spend a ton of time ... not really ... on Facebook to buy anything now for the last ... they're making a whole bunch of money on advertising to kill Eon Mobil now ... not to go well ... people don't spend as much time on Google as they do on Facebook but they have very high purchase intent ... frequently and so cool of course has a massive advertising business ... the way that this I had this magic Apple's discrediting the speed puts interest ... in the middle he says look here a lot of people if interest you're planning their weddings ... are discovering a lot of ... ah ... the things that the love ... which means there is not only sort of big ticket type of site ... that people so people are spending lots of time like on Facebook but they also have ... very high purchases and kind of like a will which is why people think this one does have ... alot potentially really can be a money machine ... and hands and so it's up to the potential of that ... when I got a valuation Prebon and Pulliam Act came a ... hand in glove with an outlet close to a quarter billion dollars write two and twenty five million in infusion ... wall will last-minute be useful ... building out the website they want to invest in technology if they want to invest in sales by ... Micah said they're just beginning to test advertising so they can have to sell it ... they also will expand ... internationally have very aggressive ... international expansion plans they've only recently ... started rolling out a lot of other countries they want to go to a lot of other ones ... so that that is can it be were a lot of this money gets spent the described been around ... this financing round really ... like a lot of these companies do is as as quote opportunistic in the money is there so we might as well get it because we have a live there places we'd like to invest ... how can ... go Brett softer form and thank you very much ... Rolfe Winkler of The will Street don't we appreciate time so ... a key Senate time Simon Qassam on and this is doubly SJ lie ...